DETROIT — With little progress reported in its labor talks with the United Auto Workers, Chrysler faces a midnight contract deadline tonight that could put its 70,000 U.S. and 10,000 Canadian hourly workers out on picket lines, forcing the No. 3 auto maker to shut down its North American operations just as it is gearing up for the 1986 model year.

The negotiations were continuing at a slow pace Monday despite a weekend warning from UAW President Owen Bieber that the union was prepared to strike unless the company stopped its foot-dragging in the talks, which began in August. The UAW wants Chrysler to once again pay wages and benefits that are equal to those paid union workers at General Motors and Ford, but the company's economic proposals have so far failed to satisfy the union's demands.

On Monday, union officials said they had still not received a revised wage offer from the company following their rejection last week of an earlier proposal. The two sides are also still far apart on the union's key non-wage demand for Chrysler to limit its subcontracting of work to foreign suppliers. At the same time, Chrysler has been meeting union resistance in its demands for major and controversial changes in union work rules in its plants in order to improve productivity.

But union leaders stressed that the UAW is not committed to calling a nationwide strike if the talks fail to produce an agreement tonight. In fact, if a settlement isn't reached by midnight, it is possible that the UAW might employ the same strategy that it used last year against GM by invoking a selective strike against a limited number of key plants. That would keep the number of workers forced to leave their jobs to a minimum while still wreaking havoc on Chrysler's manufacturing system.

Taking Harder Line

In Canada, however, the newly independent Canadian UAW is apparently taking a harder line than the American union in its talks with Chrysler. Chrysler is the first major auto maker to bargain with the Canadian UAW since it broke away from the American union last year, and outside observers believe that the union's leadership is determined to make major wage gains to show their members that the split was worthwhile. While the American UAW has not yet made midnight an absolute strike deadline, the Canadians have vowed to walk out immediately if they fail to reach an agreement tonight.

The Canadian UAW has demanded that Chrysler follow the contract pattern set in Canada last year by GM, while the company is offering to pay less. A UAW spokeswoman in Toronto said that the company made its first wage offer to the union Monday but that it was rejected by the union. She said all talks on non-wage issues between the two sides have been suspended until the company presents a new economic proposal.

The Canadian union has the leverage to pull off an independent strike against Chrysler even if the American union settles first. Chrysler's Windsor, Ontario, plant is its sole source for its popular mini-vans, and a strike there would dry up Chrysler's mini-van supply just as Ford and GM are entering that lucrative market for the first time. And a shutdown of Chrysler's parts plants in Canada would begin to affect Chrysler's U.S. plants within two weeks, company officials say.

Meanwhile, the American UAW said Monday that, if a tentative settlement is reached in the United States within the next few days, 170 UAW leaders from Chrysler plants around the country will vote on the new pact at a meeting in Huntsville, Ala., on Oct. 19.